The Superior Way Seasoned Business Owners Can Grow Their Revenues Though frequently overlooked, reactivating former customers may be the simplest option for business owners looking to quickly ramp up without breaking the bank.
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What would you do if you needed to get some new clients and revenue before the next month?
If you're a business owner, even a well-established business owner, this will happen to you at some point. For instance, how would you respond if a few clients unexpectedly leave you at once? Similarly, could you absorb the crushing blow of learning that some of your clients simultaneously can't pay you on time or even at all? Additionally, what happens if you find your leads or sales pipeline is drying up?
In all of these cases, before your business goes too far south, you'll need to correct your course quickly or it could be too late.
A proven but overlooked strategy that brings in revenue
There are a plethora of viable options that help business owners immediately increase their revenue. Boosting advertising spend, optimizing pricing strategy and running seasonal promotional campaigns are just a few popular examples that come to mind.
Another highly effective strategy is to reactivate former customers. Though frequently overlooked, reactivating former customers may be the simplest and lowest cost option for established business owners to quickly ramp up revenues without breaking the bank.
Customer reactivation by itself can be a confusing term and varies by industry, so let's break it down. When referring to a customer in this article, it's anyone that is buying a product or service from your company. It's not a lead, qualified lead, prospect, referral partner or another stakeholder. It's an actual paying customer. To simplify the explanation here, a customer can also be referred to as a client, patient or member, depending on your profession.
So what type of customer should you set out to reactivate? This strategy has nothing to do with your current customers. Rather, it has everything to do with your former customers. The intent of the reactivation outreach process is for those former customers to not only re-engage, but also begin to pay for your products or services again. Essentially, you want to wake up and resurrect past client relationships and win them back.
Benefits of a customer reactivation campaign
Some organizations refer to former customers as lost, dormant, lapsed, previous or inactive. Whatever you do, please don't refer to your prior clients as "dead customers". I know you want to bring some of these inactive customers "back from the dead", but what if some names on your client list are in fact deceased? I've been in client meetings where this has happened and it can get awkward in a hurry.
Regardless of what your preferred name is for a former customer, a well-defined and well-run customer reactivation process produces numerous benefits:
Increased revenue for the short-term and the long-term - The goal is to not have the former customers vanish completely. Quick win-backs will lead to near-term upticks in revenues while consistent, timely and relevant communication with other former customers will boost reactivations and help achieve longer-term revenue goals.
Decreased customer acquisition costs - Remember, these technically are not new clients. These former customers are ready to be reacquired. They're already familiar with you and many of them already had a good experience with you. Moreover, the majority of them likely left for reasons not related to the performance of your product or service or your company staff. On that note, the adage that it costs five times more to find and create a new customer than to keep an existing client or resuscitate an old one holds true here.
Enriched current customer experience - As you uncover why former customers left you, that knowledge can be applied and new systems and processes can be put in place that better serve the needs and preferences of existing customers so that they become more satisfied and stay with you longer.
Decreased customer churn - having more intel on current customer trends, former customer behavior, their purchase history and the likes or dislikes of other competitor offerings will result in a more seamless end-to-end customer experience that should lead to higher customer loyalty and lower customer turnover.
How to successfully launch a reactivation campaign
Below are the key steps to follow to profitably launch and execute your next former customer reactivation initiative:
Determine your target campaign audience - Identify who you want to go after first. When exactly did they stop buying from you? Why did they leave? It's important to factor in that the odds of reactivating a customer will increase if they previously sent you referrals, chose to leave for a reason other than poor service or had past inquiries and escalations promptly and satisfactorily addressed.
Establish your campaign goal and success criteria - Besides getting sales from the former customers again, are you also looking to introduce them to a new product offering or upgrade them to a new release or package?
Create your personalized, compelling content and strategies/responses to win them back - Based on their purchase history and reasons captured for leaving, begin preparing the appropriate messaging and enhancements to highlight in the unique offers for their applicable buyer's persona.
A/B test various offers - You don't always have to offer discounts or incentives to earn back a customer. In many cases, just having a new product line or service offering will be more than enough to intrigue the former customer to do business with you again.
Follow-up via different channels - Be sure to use the telephone for a follow-up in addition to email in case your note is somehow going to their junk or spam folder. Staying in front of your customers through different channels is highly recommended.
Measure your campaign performance - Track which outreach technique works the best, uncover which segment of your database returns to be a customer with a higher likelihood, and learn which competitors are easiest to take business back from.
Keep accurate and up-to-date records - Industry leaders leverage a centralized and integrated CRM system to track the history of all customer activities, purchases, sales opportunities and service incidents. Be sure to also instill a client offboarding process going forward so that all reasons for leaving can be captured while fresh in the customer's mind. That data can then be utilized to prepare for a more effective reactivation outreach campaign in the future.
If you're a business owner with an established client list in need of a quick revenue recharge, tap into the power of the customer reactivation strategy. After all, if best-in-class companies are committed to balancing new client acquisition efforts with a customer reactivation outreach strategy, why shouldn't you as well? You'll be amazed at how quickly you can get some wins on the board. Whenever my clients are looking for a revenue boost in a short period of time before month-end or quarter-end, I always advise them to reach out to their former customers. In fact, one client family member recently shared he brought in as much revenue in two weeks as he normally does in two months!
Your former customers already know who you are and it's a much shorter sales cycle. What have you got to lose?